
The Academies Financial Handbook is updated annually by the Department for Education and the Education and Skills Funding Agency; it contains a number of governance requirements for academy trusts.
Chapter 1 of the Green Paper says that the Government proposes the following principles should be “included in the new legislation”. These principles (with brief thoughts from us on some of them) are:
The approach of setting out general principles in legislation is a typically European approach to legislation. It’s a bit like placing a legal obligation on citizens to do whatever is necessary to restrict the spread of Covid-19, without setting out the practical steps citizens must follow to comply with that duty.
The typical UK approach to legislation (of setting out detailed rules rather than general principles) leads to greater clarity (and therefore less cost) for contracting authorities and suppliers. It is particularly appropriate for legal jurisdictions such as England and Wales where court decisions are based mainly on previous case law than through working from general principles. It also means that the potential “conflicts” between the requirements of the different principles need to be resolved in the legislation itself, rather than being left to contracting authorities to resolve.
The European legislative approach of setting out general principles does give greater flexibility though. It also potentially signals a move towards “legislation by guidance”, with the required practical steps being set out in guidance issued later (but which has not received Parliamentary scrutiny) rather than in the legislation itself.
It is curious that a government that has pursued Brexit specifically to be able to set their own rules in areas such as procurement, is proposing such a European approach to legislation.
We also have concerns over some of the proposed principles. A requirement to follow “national guidance” on the “public good”, may not be appropriate for democratically elected local authorities who may have a different mandate or charitable registered providers of social housing who have different charitable objectives. As set out above, there are tensions between some of the principles which ought to be resolved in the legislation.
We will be making these comments in our response to the consultation paper, which is to be submitted by 10 March 2021. In the meantime please look out for our further ebriefings on the Green Paper.
For further information in relation to any of the above, please contact your relevant ACS contact or Andrew Millross.
The Academies Financial Handbook is updated annually by the Department for Education and the Education and Skills Funding Agency; it contains a number of governance requirements for academy trusts.
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